Mark Mobius’ recent note on China: The bears are wrong

“…At this time, I believe there is a bit more wiggle room for further stimulus in China and some other emerging economies, as they appear equipped to absorb these changes potentially without dramatically negative results. Fearful talk about the slowdown in China is ubiquitous, but as I have said several times, I don’t believe China is facing a hard landing, and that is worth repeating.

In my long-term view, China still has quite a lot of potential in its favor. China’s banking system looks to be in good shape, and infrastructure investment has been booming. The country’s foreign reserves at the end of 2011 totaled US$3.2 trillion1, the largest in the world. Perhaps China’s biggest resource, though, is its 1.3 billion people,whose incomes and standard of living have been rising. The shift to a consumer-oriented culture is well underway and seems poised to continue for the long term. If you think the Chinese people are going to give up their new cars and go back to bicycles, I can tell you: you’re probably mistaken!”